are most likely to export corruption, i.e. to win abroad business deals by paying bribes. BPI thus studies the supply side of corruption.[2] According to TI, the governments of corruption-supplying countries should be held responsible since they allow their local companies to get away with paying bribes. So far reports have been published in 1999, 2002, 2006, 2008 and 2011.[3]
The index is constructed by collecting data from senior business executives from both developed and developing countries from all over the world by using a survey called the Bribe Payers Survey. The survey contains two questions:
In your principal lines of business in this country, do you have business relationships (for example as a supplier, client, partner or competitor) with companies whose headquarters are located in any of the following countries?
How often do firms headquartered in (country name) engage in bribery in this country?
The questions are answered on a 5-point scale ranging from 1 (never) to 5 (always). When presenting the results, the data is converted to a 10-point scale system, from which the average score for every country is calculated, finally indicating each country’s index score. A score of 0 corresponds with the perception that companies from that country always pay bribes when doing business abroad. Thus, a score of 10 is the benchmark result stating that companies in that country are perceived to never pay bribes, while any score under 10 is less than perfect.[4]
Key Findings of Report 2011
The 2011 Bribe Payers Index Report ranks the world’s 28 wealthiest corrupt countries in international business, but it also defines the worst offenders of the industrial sectors.[5] Six key findings are presented:
Clear evidence of bribery between private companies - Bribery between companies of different sectors is viewed equally common as between firms and public officials.
No improvement over time - On average, there has been no improvement in perceptions of foreign bribery frequency since the last report from 2008.
Business integrity matters - There is a connection between a country’s BPI ranking and the views of the domestic business integrity levels.
Home country governance matters - There is also correlation between a country’s BPI ranking and local perceptions of corruption in the public sector.
China and Russia: weak performance, high impact - Chinese and Russian companies were perceived as most likely to pay bribes. The growing role of both countries in international trade makes improvement an urgent issue.
Bribery prevalent across business sectors - Bribery is presumed to occur in all business sectors but is seen as most common in public works contracts and the construction sector.[6]
Foreign Bribery and CSR
As it can be stated from the conclusions of the latest BPI report, an important first step in fighting foreign bribery cultures within domestic businesses is for the governments of each country to establish effective anti-corruption systems. Those few countries listed in the BPI who have not yet ratified international conventions against corruption and bribery (e.g. the OECD Anti-Bribery Convention) should naturally first adopt these legal frameworks, and only then proceed to applying these to national legislation.[7]
U.S. Anti-Bribery Model. Reference: Cleveland, M. et al. (2009).
However, studies show that international bribery is still considered somewhat acceptable in key countries of international trade, such as the U.S., where international bribery was criminalized more than thirty years ago (the Foreign Corrupt Practices Act). It is therefore safe to say that legislation alone cannot stop foreign bribery.[9]
Another essential element in reducing foreign bribery is keeping up high standards of corporate integrity. Establishing a business culture that does not tolerate bribery or corruption requires anti-corruption policies and procedures that are effectively implemented, and also communicated to company stakeholders.[10]
This theory has been confirmed by the Secretary General of the International Chamber of Commerce, stating that “Companies most effectively establish their credentials of good corporate citizenship by applying their own principles of corporate conduct. These may take the form of formal codes or unwritten values and internal monitoring, appraisal and reporting procedures that guide corporate operations”[11]
TI has developed a framework tool called the Business Principles for Countering Bribery, with the purpose of facilitating the establishment of anti-bribery programs for private sector companies.
BPI Critique
Corruption perception indexes, such as the BPI, have been critized in several studies for claiming that the sole perceptions of corruption are in fact evidence of the existence or non-existence of corruption in a certain cultural context. According to the opposing researchers, the perceptions of individuals cannot be an accurate measure of corruption due to fundamental conviction, subjectivism and bias. Perceptions can also be easily distorted by for e.g. hearsay and selective media coverage.[12][13]
BPI and Finland Finland has not been ranked in any of the previous BPI reports since it has not been viewed as one of the leading economies. All countries ranked in the 2008 index are also mentioned in the latest report.[14]
However, it can be stated that if Finland would be included one day, it would probably be awarded with relatively high scores. This is due to its constant top scores and rankings in the CPI, which has high correlation with the results of the BPI.[15]
Finland’s culturally perhaps closest neighbour, Sweden, has been qualified three times. It has been awarded with scores ranging from 7.62 up to 8.4, placing first in -99 and second in -02 and -06.[16]
de Maria, B. (2008). Neo-colonialism through measurement: a critique of the corruption perception index. Critical perspectives on international business, 4(2/3), 184-202.
^ Dion, M. (2013).Uncertainties and presumptions about corruption. Social Responsibility Journal, Vol. 9 Iss 3 pp. 412 - 426.
Definition
Table of Contents
are most likely to export corruption, i.e. to win abroad business deals by paying bribes. BPI thus studies the supply side of corruption.[2] According to TI, the governments of corruption-supplying countries should be held responsible since they allow their local companies to get away with paying bribes. So far reports have been published in 1999, 2002, 2006, 2008 and 2011.[3]
The index is constructed by collecting data from senior business executives from both developed and developing countries from all over the world by using a survey called the Bribe Payers Survey. The survey contains two questions:
- In your principal lines of business in this country, do you have business relationships (for example as a supplier, client, partner or competitor) with companies whose headquarters are located in any of the following countries?
- How often do firms headquartered in (country name) engage in bribery in this country?
The questions are answered on a 5-point scale ranging from 1 (never) to 5 (always). When presenting the results, the data is converted to a 10-point scale system, from which the average score for every country is calculated, finally indicating each country’s index score. A score of 0 corresponds with the perception that companies from that country always pay bribes when doing business abroad. Thus, a score of 10 is the benchmark result stating that companies in that country are perceived to never pay bribes, while any score under 10 is less than perfect.[4]Key Findings of Report 2011
The 2011 Bribe Payers Index Report ranks the world’s 28 wealthiest corrupt countries in international business, but it also defines the worst offenders of the industrial sectors.[5] Six key findings are presented:Foreign Bribery and CSR
As it can be stated from the conclusions of the latest BPI report, an important first step in fighting foreign bribery cultures within domestic businesses is for the governments of each country to establish effective anti-corruption systems. Those few countries listed in the BPI who have not yet ratified international conventions against corruption and bribery (e.g. the OECD Anti-Bribery Convention) should naturally first adopt these legal frameworks, and only then proceed to applying these to national legislation.[7]However, studies show that international bribery is still considered somewhat acceptable in key countries of international trade, such as the U.S., where international bribery was criminalized more than thirty years ago (the Foreign Corrupt Practices Act). It is therefore safe to say that legislation alone cannot stop foreign bribery.[9]
Another essential element in reducing foreign bribery is keeping up high standards of corporate integrity. Establishing a business culture that does not tolerate bribery or corruption requires anti-corruption policies and procedures that are effectively implemented, and also communicated to company stakeholders.[10]
This theory has been confirmed by the Secretary General of the International Chamber of Commerce, stating that “Companies most effectively establish their credentials of good corporate citizenship by applying their own principles of corporate conduct. These may take the form of formal codes or unwritten values and internal monitoring, appraisal and reporting procedures that guide corporate operations”[11]
TI has developed a framework tool called the Business Principles for Countering Bribery, with the purpose of facilitating the establishment of anti-bribery programs for private sector companies.
BPI Critique
Corruption perception indexes, such as the BPI, have been critized in several studies for claiming that the sole perceptions of corruption are in fact evidence of the existence or non-existence of corruption in a certain cultural context. According to the opposing researchers, the perceptions of individuals cannot be an accurate measure of corruption due to fundamental conviction, subjectivism and bias. Perceptions can also be easily distorted by for e.g. hearsay and selective media coverage.[12] [13]BPI and Finland
Finland has not been ranked in any of the previous BPI reports since it has not been viewed as one of the leading economies. All countries ranked in the 2008 index are also mentioned in the latest report.[14]
However, it can be stated that if Finland would be included one day, it would probably be awarded with relatively high scores. This is due to its constant top scores and rankings in the CPI, which has high correlation with the results of the BPI.[15]
Finland’s culturally perhaps closest neighbour, Sweden, has been qualified three times. It has been awarded with scores ranging from 7.62 up to 8.4, placing first in -99 and second in -02 and -06.[16]
What We Do, Transparency international (2014). http://www.transparency.org/research
Bribe Payers Index, In Detail, Transparency international (2014). ttp://www.transparency.org/bpi2011
Bribe Payers Index, In Detail, Transparency international (2014). http://www.transparency.org/bpi2011/in_detail
Bribe Payers Index, Overview, Transparency international (2014). http://www.transparency.org/research/bpi/overview
Bribe Payers Index, Report 2011, Transparency International (2011).
**Cleveland, M., Favo, C. M., Frecka, T. J., & Owens, C. L. (2009). Trends in the international fight against bribery and corruption. Journal of business ethics, 90(2), 199-244.**
**McKinney, J. A., & Moore, C. W. (2008). International bribery: Does a written code of ethics make a difference in perceptions of business professionals. Journal of Business Ethics, 79(1-2), 103-111.**
Bribe Payers Index, Report 2011, Transparency International.
Cattaui, M. L., Responsible business conduct in a global economy, OECD Observer (2000).
http://www.oecdobserver.org/news/archivestory.php/aid/335/Responsible_business_conduct_in_a_global_economy.html
de Maria, B. (2008). Neo-colonialism through measurement: a critique of the corruption perception index. Critical perspectives on international business, 4(2/3), 184-202.
Bribe Payers Index, In Detail, Transparency international (2014). http://www.transparency.org/bpi2011/in_detail#myAnchor2
Wysong, W. Indexing Corruption in Asia Pacific. Corporate Compliance Insights (2011).
http://www.corporatecomplianceinsights.com/indexing-corruption-in-asia-pacific/
Bribe Payers Index, Reports 1999; 2002; 2006; 2008; 2011, Transparency International.